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Economy

Relief as deal struck to defer fine for wind power delay

Energy secretary Charles Keter. FILE PHOTO | NMG
Energy secretary Charles Keter. FILE PHOTO | NMG 

Homes and businesses have been offered a reprieve following a deal to defer additional Sh1 billion in monthly electricity bills after Kenya failed to connect Lake Turkana Wind Power to the grid from June to September.

Energy Cabinet secretary Charles Keter said negotiations between the project’s financiers, the Kenyan government and Lake Turkana Wind Power had agreed to defer the penalty until September 1 to facilitate completion of the project.

Lake Turkana Wind Power — which has already fined Kenya Sh5.7 billion for delays — agreed additional penalty of Sh1 billion monthly should Kenya fail to connect the plant to the grid beyond June due to lack of power lines built by State-owned Ketraco.

“We (the government), the power transmission line financiers and the Lake Turkana Wind Power held talks where a deal was reached deferring implementation of the Sh1 billion penalty fee to September 1,” Mr Keter said yesterday. “We have a new contractor on site as the former one went under and we have put all government agencies on high alert to facilitate its fast-tracking to beat the August 31 deadline.”

The deal is relief to consumers who are bearing record electricity prices following increased use of expensive diesel generators following reduced cheaper hydro power due to bad weather.

Homes consuming 200 units of power paid a record high of Sh4, 262 last month, up from an average of Sh3, 727 last year and Sh3, 066 in 2013.

Delays in construction of the 428-kilometre power line has hampered electricity evacuation from the northern town of Marsabit to Suswa substation in Narok, the country’s main interchange for power coming from different sources.

This has left the wind farm developers stranded with power amid pressing cash needs such as loans repayment, an obligation that taxpayers will shoulder.

Construction of the power line started in November 2015 but was delayed by landowners’ compensation demands and the closure of a major contractor. A new contractor, NARI Group and Power China Guizhou Engineering Company, were tapped to complete the line.

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